Why IPTV is the Future?

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What is happening today with IPTV? Well, IPTV is basically similar to Cable TV with about 100+ channels broadcasted using IP Multicast over DSL. All users are expected to watch one of those channels so dimensioning the system is easy. However, if all users start watching different TV programs at their most convenient time, then you have a major scalability problem since you need to handle a massive number of streams. Rather than dimensioning your network for the number of channels, you will have to do it for the number of users.

And this is exactly what is happening in Korea where a lot of people do not watch live broadcast TV anymore. Instead, VoD services offer all TV shows and movies that you could imagine for download. So you do not need broadcast TV nor have your VCR recording all the time. Instead, you can download the programs you missed whenever you want. As a result, most users are disconnecting their cable/satellite subscription as soon as they subscribe to the VoD service!

Of course, the content providers are cooperating and fostering this type of services by making the content available in a DRM digital form soon after it is aired (often within the same day). If most of the content is available through illegal P2P downloads anyway, they may as well try to engage the user through a legal VoD system and recover some of the revenue. This is an area where a lot of progress needs to be made in Europe/US before such service becomes available.

The cost of the service varies from $10-$15/month and you can basically download as many movies/videos as you want. Average download speeds in Korea are >30Mbps, so in the blink of an eye you have your favorite TV program. The system supports both progressive downloads for real-time viewing and background delivery.

What I found most interesting is the deployment model, which is based around Telcos (i.e. as opposed to VoD portals like Amazon or iTunes). The first generation of VoD services were target for the PC, however, the new generation is based on Set-Top-Boxes, which integrate better with the TV. The reason why ISPs are in a good position to provide this service is because the already have a relationship with the customer and thus, it becomes natural to provide users with a set-top-box which is ready for VoD. The set-top-box is given for free as long as the user subscribes for a given period of time (e.g. a year).

The fact that the VoD service is provided by a particular ISP is creating some interesting scenarios. For instance, some users are deciding to switch access ISPs but still keep their original VoD service with the first ISP. Of course, the traffic now is being carried through a number of visiting ISPs who expect some form of compensation, so the VoD ISP often needs to make financial arrangements with those visiting ISPs.

This all sounds very good, but it is posing major challenges in the IP distribution network since all users are pulling VoD content using point-to-point connections. So what is coming… well, you guessed it: P2P VoD and live-streaming in set-top-boxes, which should remove most of the heat from the ISPs VoD servers. We should expect some deployments of such P2P stb coming soon, so keep an eye…